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Law extending breaks on delinquent property taxes expires

Jul 1, 2016

Some breaks for Michigan homeowners struggling to pay property taxes have expired.

Governor Snyder signed laws in 2015 that reduced interest and other penalties on delinquent taxes. They also reduced back taxes for some homeowners who owed much more than their properties were worth.

That was largely meant for Wayne County, and especially Detroit, where tens of thousands of properties enter the tax foreclosure process every year.

But those laws expired Thursday, just as thousands of people lined up at the Wayne County Treasurer’s office to pay their taxes or try and get on payment plans.

Wayne County Treasurer Eric Sabree says many homeowners have entered payment plans during the past two years.

“We’ve had a number of people,” Sabree said. “28,000 people last year, and this year we’re probably close to the same, taking advantage of this plan.”

Sabree said he’s “very concerned” that a return to the usual, 18% interest rate on back taxes could cause many to default.

“In the year 2018 -- two years from now -- if we have a lot of defaults, and we don’t get some relief from the interest again, we will probably have a huge problem,” he said.

Properties enter the foreclosure process if taxes are delinquent after three years.

A bill that would extend the law is sitting in the state Senate until at least the fall.